Ever wonder whether your state gives you a good bang for your buck? Chances are, it does.
A new Tax Foundation study shows that in 35 states, $100 buys more than $100 worth of goods. At the highest end, Mississippi buys about $115, South Dakota and Alabama buy $114 and West Virginia $113.
On the other hand, cash values are slumping in 15 states as well as the District of Columbia. The lowest values are $85 in D.C., $86 in Hawaii and New York, $87 in New Jersey and $89 in California.
Between the highest and lowest states, purchasing power differs by 36 percent. So in D.C., a person would need to make $68,000 after taxes to meet the same standard of living as a Mississippi resident with $50,000.
The study shows how the price and income relationship can vary by region. Generally, states with higher incomes have higher prices. But some states, like North Dakota, have high incomes and low prices.
The study found that California and Nebraska residents make the same average nominal income. But when adjusting income to regional price differences, California has less purchasing power.
These differences may provide evidence that imposing a uniform minimum wage across all states is mistaken, as a set hourly wage may go much further in some states than in others.
But the Obama administration is still calling for a federal wage of $10.10. Currently, the federal minimum wage of $7.25 per hour applies in 31 states, while 29 states and the District have wages above the federal rate. The federal government last increased the wage in 2007, from $5.15 per hour.
In an April blog post, Secretary of Labor Tom Perez urged Congress to increase the minimum wage. "You shouldn't have to live in the right state or have the right boss in order to get a fair day's pay," he wrote.
But his argument cited only examples of states with lower purchasing power, like New Jersey and Connecticut. A minimum wage increase could harm other states; as the Tax Foundation notes, higher incomes can drive up the price of resources.
Emily Leayman is an intern at the Washington Examiner